Mutual Funds Abandon Stock Market as Volatility Jumps (Update4)
Most Since 1938
By Eric Martin and Alexis Lydia, Bloomberg News March 26, 2008
"Daily changes of 1 percent or more in the Standard & Poor's 500 Index, the benchmark index for American equities, have occurred on 54 percent of trading days this year, according to S&P. That's the most since 1938, as hedge funds and other speculators use borrowed money to magnify returns from rapid-fire trading.
One consequence is that volume on the New York Stock Exchange has ballooned to an average 1.75 billion shares a day, the highest on record and 11 percent above last year. More than half of the 10 busiest days in U.S. options markets have occurred in 2008, fueled by strategies designed to profit from rising volatility."
Apart from this quote what I'm hearing is that the hedge funds are basically moving the market themselves. With leverage giving them Trillions of Dollars to invest they alone are able to rachet the market up or down for financial gain.
This is not "your father's stock market", so to speak. This is a different animal.
boont
Most Since 1938
By Eric Martin and Alexis Lydia, Bloomberg News March 26, 2008
"Daily changes of 1 percent or more in the Standard & Poor's 500 Index, the benchmark index for American equities, have occurred on 54 percent of trading days this year, according to S&P. That's the most since 1938, as hedge funds and other speculators use borrowed money to magnify returns from rapid-fire trading.
One consequence is that volume on the New York Stock Exchange has ballooned to an average 1.75 billion shares a day, the highest on record and 11 percent above last year. More than half of the 10 busiest days in U.S. options markets have occurred in 2008, fueled by strategies designed to profit from rising volatility."
Apart from this quote what I'm hearing is that the hedge funds are basically moving the market themselves. With leverage giving them Trillions of Dollars to invest they alone are able to rachet the market up or down for financial gain.
This is not "your father's stock market", so to speak. This is a different animal.
boont